JPMorgan Expands Kinexys Network to Support British Pound-Denominated Accounts

JPMorgan (JPM) has added support for British pound-denominated accounts to its blockchain-based payments network Kinexys, as the bank targets a gap left by the stablecoin market's overwhelming focus on the U.S. dollar.

JPMorgan has begun supporting British pound-denominated accounts on its blockchain-based payments network, Kinexys, as the bank aims to fill a void in the market.

Despite the rapid growth of the stablecoin industry, nearly all tokens are pegged to the U.S. dollar, leaving an opening for financial institutions to step in and facilitate cross-border payments in other major currencies.

Jpmorgan, a pioneer in the space with its JPM Coin launched in 2019, has already enabled corporate clients to make seamless and instant payments in dollars, euros, and now pounds, putting it in a unique position to service multinational companies' diverse needs.

The addition of the pound comes less than a year after the service expanded to handle euro transactions. A significant portion, about 80%, of Kinexys's volume is still dollar-based, highlighting the vast scale of the U.S. payments market. However, the demand for pound transfers is steadily increasing, especially from British companies, Mallela, the global co-head of the Onyx platform running the network, told Bloomberg.

This move also highlights a key limitation of the $230 billion stablecoin market, where nearly all tokens are tied to the dollar. This lack of diversity has limited options for companies requiring fast, low-cost payments in other currencies, leading major financial institutions like Societe Generale to introduce fiat-backed stablecoins in the euro, the yen, and the British pound.

The initial participants in the expanded service include SwapAgent, a post-trade firm subsidiary of the London Stock Exchange Group, and Trafigura, a leading commodities trader, both focused on streamlining their operations with the new service.

The Kinexys network is currently processing more than $2 billion in transactions every day. While substantial, this volume is a fraction of the $10 trillion in transactions JPMorgan handles daily across its entire payments business.